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IPTV is dead long live OTTIPTV

I’m almost three weeks late for my write-up of this year’s IP&TV world Forum, so I started this piece for my blog in a rush with a big sense of guilt. It turns out that my intro on the IPTV Vs. OTT debate has taken turned in to an opinion piece on it’s own (follow-on report on IP&TV World Forum 2012 coming soon with interviews from Envivio, Verimatrix and Media Melon CEO’s as well as news and demos from Ineoquest, Siemens, Harmonic, Orca and some others).

 

For the sake of clarity, in this piece, I’ll use the term IPTV to describe TV delivered over managed networks with guaranteed quality of service as opposed to OTT delivery that has to go over networks not managed by the service provider. IPTV services are generally those delivered by Telco’s (e.g. Orange TV, ATT Uverse), whereas OTT services are usually offered by content owners (BBC, Hulu) or dedicated start-ups (Netflix, Roku).

 

I gave my first IPTV presentation in 2004. Some visionaries were already talking about OTT. But that’s another story. The first thing I did then was to define the term IPTV because no one agreed on what it actually meant. As far as buzzwords go, IPTV had a pretty good run for its money, staying trendy for almost a decade.

Prior to this year’s IPTV show, I predicted on my blog that OTT would be the only common theme for the second year running.

This year’s IPTV world forum was the biggest yet, yet it was the last. Next year the show is being rebranded. (Incidentally as the IP&TV rebranding never took, I wonder if the new TV Connect rebranding will fare any better; IPTV is a strong brand name). That must be saying something. Has the great IPTV ship sunk under her own weight?

Is IPTV really gone for good, or has it just gone out of fashion? I remember wearing a scarf of my grandfather’s a few years after he died. He’d had it for decades. Yet when I wore it on one evening, I was amazed to receive compliments on being so trendy (I actually have no dress sense when it comes to fashion as you may have noticed). As it happens the design was just making a comeback.

Likewise, might the IPTV World Forum comeback in 20 or 30 years? You’re probably laughing at such a stupid question: technology isn’t like clothing. Well maybe so, but people respond to fashion in the same way whatever the subject.

 

Some say IPTV has failed because big Telcos that ploughed hundreds of millions of Euros into the technology have not recouped their investment. We’ve tried for years to convince ourselves (and investors) that IPTV was a sound defensive strategy. All the clever multi-play bundling was keeping customers from churning. Actually it was, it’s just that it only put a plaster on the wound without healing it first. IPTV is just a tool and teaching someone how to use a tool from another trade, doesn’t teach her how to actually make a living out of that trade. Belgacom is a very rare counter-example amongst Telcos - having put a real TV exec at the steering wheel;  they are now the only ones who can actually claim genuine IPTV success. Ironically much of their technology has recently gone obsolete as NSN their main provider has decided to drop IPTV products.

It’s probably significant that at the same time Siemens (not Nokia Siemens Networks, i.e. NSN) is making a big push back into the TV space, but with an exclusively OTT model.

So what has actually failed with IPTV is the Telco’s attempt to use TV to climb up the value chain. The technology itself needed a few years to have the wrinkles ironed out, but works very well now.

The market cap of any major Telco with a big IPTV offering, when compared with that of Apple or even Google, tells the same story.

 

Last year I wrote a successful blog entry on why France, having been the birthplace of IPTV, would probably also be its first grave. The article generated a thread of over a 100 comments on LinkedIn and I was quite chuffed when Gavin Whitechurch the head of IPTV World Forum series gave me an analyst spot at last year’s London forum.

 

My “the death of TV” analyst briefing was a learning experience. There were five other analyst tables and as doors opened, delegates came in and chose their table. The other tables were about fine things in the future (namely OTT) and most had about six people - one even had a dozen. Mine had none! So I’ve learnt from that marketing mistake: this article isn’t about IPTV’s woes but about OTTTV’s great potential.

 

Back to the real reason I believe it is simply a question of fashion. The current fuss over OTT is still about delivering TV through the Internet Protocol. If we didn’t suffer from a need for novelty all the time we’d be calling it IPTV because it still is.

Delivering video service OTT won’t kill IPTV. On the contrary it’s going to complement IPTV delivery and even help it by extending its reach. It’s an ideal technology for IPTV operators to delivery multiscreen or TV-anywhere experiences.

We’re just finishing a White Paper with Harmonic, Orca, Broadpeak and Viaccess on this very topic. Before OTT can make managed IPTV delivery obsolete, we’ll need a very different Internet from the one we have today. There will be a market for delivering TV over managed networks as far as technology roadmaps can go.

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IPTV World Forum reports on Videonet

IPTV World Forum blogs are on videonet.

Overall there was a great attendance, with lots of people coming to Olympia to do business. The booths were decent although I didn't spot many exciting innovations this year and as usual the conference was of varying quality, from gems to blatant sales pitches.

The 2010 conference taught me that Canvas is a purely British thing for now, and a few companies companies stood out for me:

  • Netgem for their ability to do fancy stuff with run-of-the-mill chipsets,
  • Echostar for finally winning a deserved award for Sling-loaded
  • BeeSmart for their interesting freebee initiative,
  • Intel for getting Sodaville up and running, most impressive with Amino.

But overall it was a good show on my subjective scale.

Day 1 blog post is here

Day 2 blog post is here

Day 3 blog post is here.

Also some in depth analysis of some of the issues I became aware of at the show to follow.

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IPTV World Forum Eastern Europe 2009 Roundup

[lang_en]The turn out subjectively seemed to those who I spoke with, to be disappointing, but Informa, the conference organisers, were as always upbeat pointing to the 60+ operators present and the 20+ exhibitors. So I suppose, as the recession isn’t officially over, the glass is over half full.

The conference was setup around cosy tables so it was hard to judge the audience size but there were always between 50 and 100 people present in the conference.

The conference was branded with “quality of experience” and there was some effort to get that into the titles of some of the talks. But what I saw of day one talks didn’t reflect that. I suppose it’s the editorial control issue here. Informa can’t enforce much, the upside of which can be some surprising talks. One speaker I spoke to actually admitted to not really knowing what quality of experience actually is … I picked up a few snippets like from Michal Taborsky that Telefonica O2 has no plans on OTT yet and that HD is delivered in a best effort mode and so not charged for yet in the Czech Republic.

Sebastian Becker, founder, thebrainbehind, stood in as chair on day two. He was surprised by how cautious Russia seems to be with IPTV. It was surmised that torrent users are dominating/ruining this market. Croatians on the other hand seemed bullish on IPTV probably because of the lack of cable there.up

Mihai Crastelnau made a good presentation about the myths of content sourcing that we all say is so veeeeeery difficult, namely because you can’t work with studios. Well that may no longer be the case. It is however still not so easy to get all the details right like the metadata, subtitles, dubbing, encoding, etc.

A learning that OTE shared with the audience was that there should be a significant gap between the price for double play and triple play. Iskon in Croatia uses 25%, which seems to fit the market well.

The Orange IPTV advertising experimentation seems to be still in very early days, like the red button was in 2003. Orca and Dreampark both gave convincing middleware presentations. Finally Sebastian noted how NBC Universal showed their new channel branding strategy is a way to become must-have channels. Their message to platforms is (surprise-surprise) to focus on quality rather than quantity.

Overall, Sebastian Becker thought it was a good show considering the circumstances, although as chair he regretted that the audience didn't ask many questions.

The exhibition was well laid out in such a way that, unlike in London, no booths were stuck in the corner off the beaten track. Informa cleverly served a scrumptious desert in the middle of the exhibition so there was plenty of passage.

I randomly dropped into some booths of companies I didn’t really know.

Gravity is a Hungarian start-up in the recommendation space. They proudly stated at the booth that they were “Founder of the overall best Netflix prize best team”, but I never got to the bottom of that and everyone in this space claims some sort of link. Their demo worked fine, but with a database of 120 movies at the show I was unimpressed. If I get the time I’ll try out their half collaborative filtering half metadata approach on the web with a real database.up

I was more impressed by the DS2 booth. DS2 is a Spanish chip and reference design company for power line communications (PLC) devices. Their chipsets end up in the PLC devices from the likes of D-Link or Netgear. They compete with Intellon (also at the show) and claim a few USP’s like a TR-069 client option for just an extra $1. This could enable an operator to do things like upgrade a device firmware or reboot a customer’s PLC device. As we look towards more and more commitment from operators to manage IPTV services this looks like a really smart move.

DS2 sell a tiny daughter card for $16-20 which will let you integrate PLC into other devices, so it could for example be in the modem-router and STB of the operator straight out of the box.

The big news for folks in the PLC market is ITU-T’s ratification just this month of the G.hn standard that will enable true compatibility between vendors (hmmm sounds familiar, I thought that was already the case, I suppose it can’t be). DS2 say they’ll have new 400 Mbps devices ready and compatible by the end of 2010. Current devices are at 200 Mbps. Remember to halve all published rates between the physical layer advertised and what is achievable at o-an IP level. The dynamic range (i.e. how far you can get two PLC devices to talk to each other) isn’t expected to change though. So if it doesn’t work in your home now, it won’t any time soon.

As Evertz are at most of the IPTV shows and I have no idea what they do, I thought I’d stop by to find out. The first good news is that they come from Canada. They sell - and do correct me if I'm wrong with the technicalities - 3RU racks where you can slot up to 15 cards each of which takes an SDI input and spurns out an MPEG stream ranging from 1 to 20 Mbps. So I deduct that they do encoders. The company website (which feels uncannily like you’re at the Hertz rental car company) did little to help deepen my understanding. I’ll try the literature next time and anyone from Evertz please feel free to contact me for proper write up.

I stopped off at the Open IPTV Forum booth where I had three green t-shirted friendly people all to myself (hmm wonder who pays for that). Starting from 8 founding members in 2007 they boast an impressive 58 paid-up members. They have no pure-play middleware vendors (Ericsson doesn’t count because they supply the whole ecosystem). If they did have, say, Dreampark, it could help to get their specs off the white-boards and into live deployments.up

As I passed the Orca booth, Sefy Ariely, VP Sales & Marketing at Orca Interactive, grabbed my arm and told me he was a bit cheesed off [with me] about the comments I’d made in my last piece about them showing the Compass demo over and over at show after show (Read IBC 2009 report on Middleware). I told Sefy I had been nice because not only was it repetitive, but getting less interesting than it was in the beginning. Sefy, being a seasoned professional, had an answer to every objection. It was first just a concept demo, now it’s a real product. It looks like we just have to accept that real products are less exciting than demos.[/lang_en]
[lang_fr]The turn out subjectively seemed to those who I spoke with, to be disappointing, but Informa, the conference organisers, were as always upbeat pointing to the 60+ operators present and the 20+ exhibitors. So I suppose, as the recession isn’t officially over, the glass is over half full.

The conference was setup around cosy tables so it was hard to judge the audience size but there were always between 50 and 100 people present in the conference.

The conference was branded with “quality of experience” and there was some effort to get that into the titles of some of the talks. But what I saw of day one talks didn’t reflect that. I suppose it’s the editorial control issue here. Informa can’t enforce much, the upside of which can be some surprising talks. One speaker I spoke to actually admitted to not really knowing what quality of experience actually is … I picked up a few snippets like from Michal Taborsky that Telefonica O2 has no plans on OTT yet and that HD is delivered in a best effort mode and so not charged for yet in the Czech Republic.

Sebastian Becker, founder, thebrainbehind, stood in as chair on day two. He was surprised by how cautious Russia seems to be with IPTV. It was surmised that torrent users are dominating/ruining this market. Croatians on the other hand seemed bullish on IPTV probably because of the lack of cable there.haut

Mihai Crastelnau made a good presentation about the myths of content sourcing that we all say is so veeeeeery difficult, namely because you can’t work with studios. Well that may no longer be the case. It is however still not so easy to get all the details right like the metadata, subtitles, dubbing, encoding, etc.

A learning that OTE shared with the audience was that there should be a significant gap between the price for double play and triple play. Iskon in Croatia uses 25%, which seems to fit the market well.

The Orange IPTV advertising experimentation seems to be still in very early days, like the red button was in 2003. Orca and Dreampark both gave convincing middleware presentations. Finally Sebastian noted how NBC Universal showed their new channel branding strategy is a way to become must-have channels. Their message to platforms is (surprise-surprise) to focus on quality rather than quantity.

Overall, Sebastian Becker thought it was a good show considering the circumstances, although as chair he regretted that the audience didn't ask many questions.

The exhibition was well laid out in such a way that, unlike in London, no booths were stuck in the corner off the beaten track. Informa cleverly served a scrumptious desert in the middle of the exhibition so there was plenty of passage.

I randomly dropped into some booths of companies I didn’t really know.

Gravity is a Hungarian start-up in the recommendation space. They proudly stated at the booth that they were “Founder of the overall best Netflix prize best team”, but I never got to the bottom of that and everyone in this space claims some sort of link. Their demo worked fine, but with a database of 120 movies at the show I was unimpressed. If I get the time I’ll try out their half collaborative filtering half metadata approach on the web with a real database.up

I was more impressed by the DS2 booth. DS2 is a Spanish chip and reference design company for power line communications (PLC) devices. Their chipsets end up in the PLC devices from the likes of D-Link or Netgear. They compete with Intellon (also at the show) and claim a few USP’s like a TR-069 client option for just an extra $1. This could enable an operator to do things like upgrade a device firmware or reboot a customer’s PLC device. As we look towards more and more commitment from operators to manage IPTV services this looks like a really smart move.

DS2 sell a tiny daughter card for $16-20 which will let you integrate PLC into other devices, so it could for example be in the modem-router and STB of the operator straight out of the box.

The big news for folks in the PLC market is ITU-T’s ratification just this month of the G.hn standard that will enable true compatibility between vendors (hmmm sounds familiar, I thought that was already the case, I suppose it can’t be). DS2 say they’ll have new 400 Mbps devices ready and compatible by the end of 2010. Current devices are at 200 Mbps. Remember to halve all published rates between the physical layer advertised and what is achievable at o-an IP level. The dynamic range (i.e. how far you can get two PLC devices to talk to each other) isn’t expected to change though. So if it doesn’t work in your home now, it won’t any time soon.

As Evertz are at most of the IPTV shows and I have no idea what they do, I thought I’d stop by to find out. The first good news is that they come from Canada. They sell - and do correct me if I'm wrong with the technicalities - 3RU racks where you can slot up to 15 cards each of which takes an SDI input and spurns out an MPEG stream ranging from 1 to 20 Mbps. So I deduct that they do encoders. The company website (which feels uncannily like you’re at the Hertz rental car company) did little to help deepen my understanding. I’ll try the literature next time and anyone from Evertz please feel free to contact me for proper write up.

I stopped off at the Open IPTV Forum booth where I had three green t-shirted friendly people all to myself (hmm wonder who pays for that). Starting from 8 founding members in 2007 they boast an impressive 58 paid-up members. They have no pure-play middleware vendors (Ericsson doesn’t count because they supply the whole ecosystem). If they did have, say, Dreampark, it could help to get their specs off the white-boards and into live deployments.haut

As I passed the Orca booth, Sefy Ariely, VP Sales & Marketing at Orca Interactive, grabbed my arm and told me he was a bit cheesed off [with me] about the comments I’d made in my last piece about them showing the Compass demo over and over at show after show (Read IBC 2009 report on Middleware). I told Sefy I had been nice because not only was it repetitive, but getting less interesting than it was in the beginning. Sefy, being a seasoned professional, had an answer to every objection. It was first just a concept demo, now it’s a real product. It looks like we just have to accept that real products are less exciting than demos.[/lang_fr]